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The impact of HRM policies and practices is an important topic in fields of human resource management, industrial relations and organisational psychology (Jones & Wright, 1992).
There are different aspects of HRM and has been defined in many different ways. In particular, there have been debates about whether HRM is different from personnel management and whether there are different types of HRM. According to Storey HRM is a distinctive approach to employment management, which seeks to obtain competitive advantage through the strategic deployment of a highly committed and skilled workforce using an array of cultural, structural and personnel techniques.
The emergence of HRM began in the 1980s in United States and UK respectively. There are a number of reasons for that; the most crucial one major pressure experienced in product markets during the recession of 1980-82. By 1980s, the US economy was being challenged by overseas competitors, most particularly Japan. Discussion tended to focus on two issues: The productivity of the American worker particularly compared with Japanese worker, and the declining rate of innovation in American industries (Devanna et al, 1984:33)
With marketplace challenges such as growing international competition, the increasing complexity and size of organizations, and slower economic expansion, a growing number of organizations have come to recognize that a strategic approach to the management of the human resource function is becoming a business necessity (Beer et. al., 1985; Dyer and Holder, 1988, Norton, 1991).
We have to consider the organizational politics where the management do not allow the HR functions to succeed when implementing strategy into an organization. Blyton and Turnbull (1992) estimated that integration, in other words fit model, is far from the reality because of the dynamic business environments. For instance when it is a recession time, the HR strategy of some large, diversified organizations with a wide range of interests may focus on redundancies, and sacking employees and the business can not fit with soft HR values.
Sunil J. Ramlall (2003) has clearly states that HR professionals usually explain importance of employee morale, turnover and employee commitment as outcomes of HR efforts. The HR function was often viewed as an expense creator and administrative function and not as a value-added partner. In that case senior management do not respond in a way in which it is desired by HR department. This can be established as another barrier to effective HRM in terms of lack of support from senior management. Alan Price claims that long term HRM goals such as training and developing skills for the future are rarely considered and of employee commitment, flexibility and product quality are valued, they are sought for profit and nor pursued as beneficial workers(Price A, 1997).
According to Dessler Strategic HRM is the formulating and executing of human resource policies and practices that produce the employee competences and behaviours that the company needs to achieve its strategic aims (Dessler, 2008).
In this scenario because of mixed population while developing a strategic plan to achieve the organizational goals care has to be taken that the interest of all the members are safeguarded.
(Shuler & Jackson, 1999)
"This is the process of deciding what positions the firm has to fill, and how to fill them "
Job Analysis is the procedure for determining the duties and skill requirements of a job and the kind of person who should be hired to fit that job (Dessler, 2008). Various methods are used to collect this information viz. Interviews, questionnaires, and observation structured position analysis questionnaires can also be used PAQs.
Job Design is the process of identifying and specifying the particular tasks pertinent to a particular job and the manner in which those tasks are to be performed. Two broad goals of Job design are (1) to create some jobs that better suited the organisation and (2) to create jobs suited to the individual workers' requirements for e.g. safe satisfying and motivational.(Nancy Lea Hyer, 2002). The four approaches to job design are Mechanistic, Humanistic, Perceptual and Motivational.
"Recruiting is the means of finding or attracting applicants for the employer's open positions" (Dessler, 2008) .
This is the process of identifying the most suitable candidate(s) for a job(s) by analysing the applicant pool with screening tools such as test, assessment centres and background reference checks.
This is the procedure for providing new employees with basic background information about the firm.
According to Dressler "...any procedure that involves (1) setting work standards (2) assessing the employee's actual performance relative to those standards, and (3) providing feedback to the employee with the aim of motivating him or her to eliminate performance deficiencies to continue to perform above par."(Dessler, 2008)
Training and Development
Training and Development implies the issuing on the required skills to the relevant employees so that they can fulfil the requirements of the job. This process consists of five steps.
Remuneration Payment and Reward
This is one of the major functions of HRM were in they have to set up a standard for paying remunerations based on the outlines given by the organisation. The Hr Department has to be very apt in paying the remunerations as this acts as a very motivating factor for the employees.
Career Planning and Development
"Career Planning and Development is the deliberate process in which a person becomes aware of personal career related attributes and the lifelong series of steps that contribute to his or her career fulfilment."(Dessler, 2008)
Employees, managers and employers must play a critical role in this task. Employees specifically must match individual strengths and weaknesses with occupational opportunities and threats. (Dessler, 2008)
Employee Welfare is understood to mean anything done to improve the well-being of employees in terms of social, intellectual etc. which is not mandatory by the employee and is not included in the wages and salaries of the employees.
These are the functions of HRM but with the entry of globalization in the industry world. Redefining the functions of HRM became the need of the hour. The HRM departments had to now not only identify the changes they had to bring about but implement it as fast and efficiently as possible so as to meet the demands of the global markets. The HRM managers had to broaden their horizon as now they have to deal with a non homogenous crowd of employees who had their own sets of beliefs and cultures.
Influence of SHRM on Productivity, Policies and Procedures
The Strategic Human Resource Management is largely about integration and adaptation. Its concern is to ensure that;
Human Resource management is fully integrated to the strategy and the strategic needs of the firm.
Human Resource Policies are consistent through-out the firm
Human Resource practices are adjusted, accepted and used by the line managers and employees. (Shuler, 1997)
Since Taylor started his studies on how to manage people, Strategic Human Resources Management has gained importance and proved that it has a direct effect on the employee performance and overall company performance. Today it has a clear influence on how a company and its workforce are managed.
Sunil J. Ramlall (2003) has clearly states that HR professionals usually explain importance of employee morale, turnover and employee commitment as outcomes of HR efforts. Furthermore, the HR function was often viewed as an expense creator and administrative function and not as a value-added partner. In that case senior management do not respond in a way in this is desired by HR department. This can be established as another barrier to effective HRM in terms of lack of support from senior management. Alan Price claims that 'long term HRM goals such as training and developing skills for the future are rarely considered' and 'if employee commitment, flexibility and product quality are valued, they are sought for profit and nor pursued as beneficial workers' (Price A, 1997).
For a very long time, personnel managers have been interested in employee oriented practices such as training, and team work/team building. Earlier, the interest was on the individuals at work. Walton (1985), on the other hand, argued that such practices are a part of the "high commitment management" that was needed to promote organizational effectiveness in the present capitalist economies and their markets. Surprisingly, Lawler's(1986) Notion of "high involvement management" emphasizes employee empowerment and development as the key to organizational success as Walton himself, and he further argues that these are integral to subsequent notions of "high-performance work practices" (Huselid,1995). The emphasis is focused on the paramount importance of developing human knowledge and skills, ensuring that the environment is right for employees to reap the benefits of this and most importantly they are provided with enough work as well as a supportive team environment. This has led to the notion of strategic human resources management (SHRM) that builds on these foundations in two ways. First, it focuses on the impact of implementing such practices on organizational rather than individual performance, and second it emphasizes the synergistic link between practices so that the impact of each on organizational performance is enhanced when others are present(Becker&Huselid,2006;Combs,
Liu, Hall, & Ketchen, 2006).
Subway SHRM Policies
Subway is one of the biggest fast food chains around the world and it manages its vast outlets by uniformly applying its management techniques, layout and menu in a way that all the outlets across the world have a similar look and feel that is achieved through franchising. Tomkins (2003) points out that Subway owns many of the outlets and also uses the franchise model and has a large number of franchises across the world. The author reports that while staff in company owned outlets have higher pay, staff in franchised outlets has lesser pay and this is particularly true in developing countries such as China and India. There are certain double standards adopted in salary, job prospects and career growth for employees. This has a direct impact on productivity as Maslow's hierarchy of needs points out the need for safety, which includes the salary, has a paramount importance for the employees and franchisees are happy to exploit their labour.
Companies like Subway tend to have a high employee turnover. When a company faces employee turnover then the productivity declines accordingly. The new workforce will have to be